Huge interest in Southland green hydrogen project

It is proposed the world's first large-scale green hydrogen plant could be built in Southland with the Tiwai Aluminium Smelter site near Invercargill being mooted as a suitable location. Photo / ODT

There is huge national and international interest in the Southern Green Hydrogen project, with more than 80 registrations of interest responses received.

It is proposed the world's first large-scale green hydrogen plant could be built in Southland with the Tiwai Aluminium Smelter site near Invercargill being mooted as a suitable location after its proposed closure in 2024.

To find out the viability of the project, Meridian Energy and Contact Energy called for registrations of interest in July this year after a McKinsey & Co report revealed a plant had the potential to earn hundreds of millions of dollars in export revenue and help decarbonise societies both here and overseas.

Meridian chief executive Neal Barclay said the diversity of responses included green hydrogen for export and using it to decarbonise carbon-intensive sectors including heavy transport, aviation, shipping and agriculture sectors.

There was a huge appetite for green hydrogen to replace fossil fuels throughout the economy, he said.

"Green hydrogen has the potential to abate Aotearoa's long-life greenhouse gas emissions by more than 20 percent. It's exciting to see so much interest in domestic applications alongside the export opportunities.

"This interest suggests that the domestic uptake of hydrogen as a clean fuel could happen sooner and faster than we expected."

Contact chief executive Mike Fuge said the fact international companies were looking at business opportunities in New Zealand's domestic market, in addition to international opportunities, was very promising.

"New Zealand has a stable political environment and a realistic and rising price on carbon.

''These are good incentives for people to dial down fossil fuels and convert to cleaner alternatives, so the fundamentals are there for hydrogen to take on fossil fuels in a range of sectors."

A large number of responses were also received from engineering and technology companies interested in developing the infrastructure needed to produce and transport hydrogen from Southland.

The economic benefits of developing a hydrogen economy will support growth and employment in the regions as well as urban areas.

Fuge said hydrogen innovation was an area where Kiwi businesses and scientists were working out how to produce clean fuel more efficiently and cost-effectively.

"We're already exporting some of this technology, and the opportunities are set to grow if New Zealand seizes the opportunity to become a global leader in green hydrogen."

The next phase of the Southern Green Hydrogen project is a series of more formal discussions with shortlisted parties, followed by a request for proposal process to determine key partners and build out the wider supply chain and end-use customers.

This was expected to be completed by March 2022.